Achieving national climate and energy objectives will necessitate the addition or replacement of 80 million kilometres of power lines by 2040, equivalent to the entire existing global grid, says the International Energy Agency (IEA). In its report Electricity Grids and Secure Energy Transitions,” the IEA says that substantial changes in grid operations and regulations are imperative, and annual investments in grids need to double to over USD 600 billion by 2030.
The International Energy Agency (IEA) emphasizes the critical requirement to enhance and extend the world’s electricity grids to fulfil national climate targets and ensure energy security. As the role of electricity in energy systems continues to grow, it underscores that efforts to combat climate change and guarantee dependable power supplies are at risk unless immediate action is taken by policymakers and companies.
Electricity grids have been the backbone of power distribution for over a century, serving homes, industries, offices, and healthcare facilities. Their significance is poised to surge as electricity plays a more substantial role in energy systems. However, the IEA’s report, “Electricity Grids and Secure Energy Transitions,” presents the alarming observation that grids are failing to keep pace with the rapid expansion of key clean energy technologies like solar, wind, electric vehicles, and heat pumps. The report warns that without increased policy focus and investment, deficiencies in grid infrastructure’s reach and quality could jeopardize the target of limiting global warming to 1.5°C and undermine energy security.
BACKLOG OF RENEWABLE ENERGY PROJECTS
The report identifies impending issues, including a substantial backlog of renewable energy projects awaiting grid connection approval. It highlights 1,500 gig watts worth of such projects in advanced development stages, which is five times the solar PV and wind capacity added worldwide last year.
IEA Executive Director Fatih Birol emphasized the need for immediate action, stating, “The recent progress in clean energy seen in many countries is unprecedented and cause for optimism, but it could be put in jeopardy if governments and businesses do not come together to ensure the world’s electricity grids are ready for the new global energy economy that is rapidly emerging.”
GRID INFRASTRUCTURE FACES INCREASING DEMANDS
As electricity’s role continues to expand, grid infrastructure faces increasing demands. The adoption of technologies like electric cars and heat pumps means that electricity is encroaching into areas previously dominated by fossil fuels. Additionally, the rapid addition of renewable energy projects necessitates more power lines and robust distribution grids to ensure reliable power supply for end consumers. The digitalization of distribution grids and the incorporation of flexibility through demand response and energy storage are also part of this transition.
GRID DELAY CASE
The report introduces a scenario called the “Grid Delay Case,” which examines the consequences of insufficient grid investment and slow regulatory reforms. This scenario forecasts significantly higher carbon dioxide (CO2) emissions between 2030 and 2050 due to a slower expansion of renewable and increased fossil fuel consumption. The rise in emissions could surpass the Paris Agreement target of limiting global warming to 1.5°C, with a 40% chance of exceeding 2°C.
The report identifies strategic actions to address these challenges, including strengthening grid interconnections, supporting large-scale transmission projects, and embracing digitalization to enhance grid resilience and flexibility. Urgent action is imperative given the extended timelines for modernizing and extending grid infrastructure. Building new grid infrastructure typically takes 5 to 15 years, compared to 1 to 5 years for renewable projects and less than 2 years for electric vehicle charging infrastructure.
Enhancing and expanding grid infrastructure worldwide will necessitate increased international collaboration. Developing economies, excluding China, have seen a decline in grid investments despite substantial growth in electricity demand and ongoing efforts to achieve energy access goals. Dr. Birol stressed the importance of mobilizing financing, sharing technology access, and exchanging best practices to bolster sustainable development, improve lives, and mitigate climate change risks.